November Newsletter

In this edition:

New policy changes in effect

A number of recently announced immigration policy changes come into effect on Monday 26 November.

The first is a significant update to Post-Study work rights for student visa holders. These changes have been made in order to reduce the likelihood of the exploitation of migrants, and to ensure that the immigration pathways for international students are fit-for-purpose.

It will now be much more difficult for new international students studying below degree level to transition into a position to apply for residency. Existing students will have a reprieve though, as INZ have made very generous transitional provisions to ensure that current tertiary students are not disadvantaged.

These changes are as follows:

The Employer-Assisted Post-Study work visa (WD1) has been removed.

A three-year post-study open work visa is available for bachelor’s degree or above qualifications.

A one-year post-study open work visa is available for students studying New Zealand Qualification Framework level 4 to 6 and non-degree level 7 qualifications, with an additional year available for Graduate Diploma students whose qualification and work is needed for registration with a professional or trade body.

A time-bound, two-year post-study open work visa is available for students studying level 4 to 6 and non-degree level 7 qualifications outside Auckland (study must be completed by the end of 2021).

Students who held a student visa or were in the process of applying for a student visa to study towards an eligible qualification as at 8 August 2018 will be able to apply for:

o a three-year post-study open work visa on completion of their qualification

o a two-year post study open work visa if they have previously held a one year open post study work visa, on completion of their qualification(s)

Holders of a one year post-study work visa will be eligible to apply for a further two-year open post-study work visa.

Holders of a Post-Study Work Visa-Employer Assisted can apply to vary their visa conditions to remove the occupation, employer and location.

The second update is a further increase to remuneration thresholds for both the Essential Skills work visa, and the Skilled Migrant resident visa, as covered in our recent article.

Applicants applying from 26 November will need to be paid at the following rates:

Skilled Migrant Category (Residence)

The threshold for gaining skilled employment points will be $25 per hour for jobs at ANZSCO skill level 1, 2, or 3, and $37.50 per hour for jobs at skill level 4 or 5.

The threshold for bonus points for high remuneration will be $50 per hour.

Essential Skills (Temporary Work Visa)

The mid-skilled remuneration threshold will be $21.25 per hour for jobs at ANZSCO skill level 1, 2, or 3, and $37.50 per hour for ANZSCO skill level 4 or 5 roles.

The high-skilled remuneration threshold will be $37.50 per hour.

The new thresholds are based on the New Zealand median salary and wage rate of $25 per hour (up 2.9% from last year), equivalent to $52,000 per annum for a 40 hour per week job. These will continue to be updated annually.

New Zealanders making their mark in the world

New Zealanders certainly know how to make a big noise on the world stage. From politics and sport to science and the arts, the impact of ‘world famous’ Kiwis is significant, proving that being from a small country is no barrier to achieving greatness.

New Zealand is, in fact, a country of people achieving ‘world-firsts’. Regularly considered one of the greatest New Zealanders, Sir Edmund Hillary was the first (along with Tenzing Norgay) to successfully reach the summit of Mount Everest, in 1953. Hillary famously remarked upon his descent – in the most Kiwi of ways – “…we knocked the bastard off.” Other Kiwi trailblazers in their respective exploratory and inventive fields included Sir Ernest Rutherford (nuclear physics), Jean Batten (aviation), and John Britten (motorcycle designer). The common theme among these inspiring Kiwis was a strong curiosity about how and why things work and finding innovative solutions to problems. Along with this was a typical New Zealand trait of tenacity and do-it-yourself; a natural reaction at the time to being from a country so isolated from the rest of the world.

New Zealanders have long been a global force in the arts and creative industries. Writers that have left an imprint on the world include Katherine Mansfield and Eleanor Catton, and in the world of music, such recognisable names as Lorde, Dame Kiri Te Kanawa, and Neil Finn. Sir Peter Jackson famously marked out New Zealand as Middle Earth with the Lord of the Rings and Hobbit movies. This helped create a flourishing film industry onshore and increased the value of Kiwis involved in the business overseas. Other successful writers and directors include Jane Campion (The Piano, Top of the Lake), Andrew Adamson (Shrek), Andrew Niccol (The Truman Show, Gattica), and Taika Waititi (Hunt for the Wilderpeople, Thor: Ragnarok). Kiwi actors have also enjoyed success on the big and small screens over the years, among them Sam Neill, Russel Crowe, Anna Paquin, Martin Henderson, and the Flight of the Conchords with their unique brand of self-deprecating Kiwi humour.

New Zealand Prime Minister, Jacinda Ardern, made headlines around the world this year for giving birth while in office, and later taking her daughter Neve with her on official state visits offshore. Ardern is not the first New Zealand woman in politics to make global waves. Kate Sheppard, while not a politician, lead the suffrage movement that gave New Zealand women the right to vote in 1893 – the first country in the world to do so. Since this time the impact of women in positions of power in the country has been significant; notably 3 female Prime Ministers, and 3 Governors-General.

New Zealand has always punched above its weight on the world’s sporting stage. The All Blacks’ (recently dented) dominance in world rugby is perhaps the most famous of the country’s sporting achievements, but many other teams and individuals have made a global impact. These include Steven Adams playing for the Oklahoma City Thunder in America’s NBA, Scott Dixon (winner of 5 IndyCar championships and the Indy 500), and the team that won the America’s Cup (yachting). Add to this various cycling, rowing, motor sport, and ironman competitors who regularly top the ‘world’s best’ lists and it’s fair to say that Kiwis aren’t just there to make up the numbers.

Sir Peter Jackson once stated, “New Zealand is not a small country but a large village.” There is some merit to this, and while New Zealand is small and does have a tendency to fall off world maps, it’s worth remembering that even those from an isolated South Pacific nation can make a decent mark on the world.

The Chamber offers migrant employment assistance, and support to employers of migrants in Canterbury. This service is fully funded by Immigration New Zealand (INZ). If you have questions about living and working in New Zealand, you can visit http://www.newzealandnow.govt.nz, email your query to newmigrantinfo@mbie.govt.nz or ring the INZ Contact Centre on +64 9 914 4100.

NZ unemployment level lowest in ten years

Unemployment in New Zealand has fallen to a decade low. The September Household Labour Force Survey, which estimates the working-age population, was much stronger than expected.

The unemployment rate fell to 3.9%, the lowest since June 2008. This further strengthens the chances of suitably skilled and qualified foreigners sourcing a new career in New Zealand.

The Government’s recent change in immigration instructions come into effect on 26 November 2018. This, along with a recent significant increase in visa application fees, will have a constraining effect on employers sourcing new staff from off shore. In the last 12-month period New Zealand’s migration total was just below 63,000. This is the lowest in almost three years and is well down from the high of 72,400 from July 2017.
There has been a clear slowdown in this overall trend, with New Zealand employers now being further forced to consider investment in training and the upskilling of local staff before looking at off shore options. The question remains whether there are enough suitably qualified, experienced and, importantly, motivated NZ citizens or residents to meet the increasing demands of New Zealand employers. There appears to remain a shortfall, one that is growing on a daily basis.

Article provided by Steve Baker – Enterprise Recruitment and People.

Enterprise Recruitment and People has a national presence. We remain interested in providing obligation free advice to offshore candidate’s about their chances of securing employment in New Zealand. Steve can be contacted on steve.baker@enterprise.co.nz or 00 64 3 3530680.

Global economy update

Here in New Zealand banks have just engaged in a round of cuts to mortgage lending rates which in the case of the BNZ has taken the two year fixed rate to a 157 year low of 3.99%. This development is not at all what we economists have been expecting since 2009 when we saw the first “green shoots” of growth appear in the United States economy and we started to allow for inflation eventually returning and monetary policy tightening.

It is also not what we were expecting from two years ago when US interest rates started to be pushed higher by the Federal Reserve – a process still underway. Thankfully I have been pointing out the inability of us economists to accurately predict interest rates over the past four years. The interesting thing of course is why this lack of predictability.

In a nutshell, inflation around the world is not doing what it would have done in the past given the rates of economic growth in most countries and the tightening up of labour markets. Wages growth has remained much more muted than expected and businesses have been raising prices less than they would have in the past when faced with rising costs and good end demand for products.

No-one yet feels they have the full list of reasons as to why inflation behaviour has changed in the past decade. But on lists which do exist we find factors such as reduced unionisation, shifting of some jobs to developing economies, development of the gig economy, and greater pushback from businesses against wage rises because they struggle to raise their selling prices in turn.

Businesses face a world where consumers can now easily look for alternative products, prices and suppliers online from anywhere in the world. With this new power delivered to us by communications technologies we back away quickly when faced with a price rise and may even make negative comments about a seller on social media.

This then brings a whole new world of pressures on businesses when it comes to trying to maintain margins and keep products relevant. Always now there are alternatives easily accessible to current buyers and it may only take some extra payment of funds to Google to have new competitor adverts for products placed alongside search engine results. Customers can virtually disappear overnight.

Businesses are having to adjust what they do to allow for this. Many are having to speed up the development and introduction to market of new products to try and stay ahead of ready-to-copy competitors. Many are looking to cut costs through traditional means. Many also are trying to build extra flexibility into their operations – perhaps with more adaptable premises leases, and certainly through seeking more flexibility with their workforces.

Some are choosing to try and not lock in rising wage rates by giving remuneration rises through means which can be easily stopped should the operating environment suddenly become tough. Some businesses are offering better bonuses, gym memberships, flexible working hour and working locations.

Interestingly, there is some evidence coming out of the United States of businesses choosing not to replace staff with robots to the extent technology and current costs allow. Why? Because if costs need to be cut quickly all that can be saved when running machines is electricity and some maintenance by turning them off. But workers can be laid off or placed on furlough. Interestingly this is not really a choice being made by the bulk of NZ exporters who are farmers. For them tough times mean the volume of output probably stays unchanged but prices and therefore profits fall. Farmers respond by slashing spending.

Thankfully, in the absence of any substantial falls in NZ commodity export prices farmers seem to be making acceptable incomes still and this, along with the tourism boom, is easily underpinning growth in the regions outside the traditional migrant destinations of Auckland, Wellington and Christchurch.